Stocks Look Set to Open Higher on Renewed Confidence

Stocks are looking to open higher this morning, as Wall Street takes a rosier view of the Federal Reserve, interest rates, and inflation.

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The Dow Jones Industrial Average was pointing toward an initial gain of around 85 points, while the S&P 500, tech-heavy Nasdaq Composite, and small-cap Russell 2000 were also looking at small gains.

The big news overnight is that Treasury yields tumbled and Asian stocks jumped. The yield on the benchmark 10-year Treasury has fallen nearly 0.03 points, to 2.89%, compared to a peak of 2.95% earlier in the week. The yield on the two-year note is also off 0.01 point, to 2.24%.

Among the possible causes of renewed optimism were comments from U.S. Treasury Secretary Steven Mnuchin, who argued in a Bloomberg interview that inflation worries were overdone.

Europe is mostly flat this morning. Germany GDP and European Union inflation data were in line with expectations.

It will be another day of Fed parsing. The central bank will post its monetary policy report this morning, ahead of Chairman Jerome Powell’s testimony to Congress next week. Meanwhile, no fewer than five regional Fed presidents—New York, Boston, Cleveland, Kansas, and San Francisco—are due to speak in public today.

Morning Movers

HP (HP) is up 6%, to $22.68, in early-morning trading after its fiscal first-quarter results were much better than expected.

The PC giant said it earned 48 cents a share on revenue of $14.5 billion. Analysts were expecting 42 cents a share on revenue of $13.47 billion in revenue. Its guidance was also robust: For the full year, HP expects to earn between $1.90 and $2 a share, easily ahead of the $1.81 consensus estimate.

For the first quarter under its new CEO, the company said it earned 34 cents a share on revenue of $7.7 billion, while analysts had modeled for earnings per share of 22 cents on revenue of $7.07 billion. It too had better-than-expected guidance, saying that it will earn between $1.35 and $1.45, above the consensus of $1.18.

The display-component maker said it earned 93 cents a share on revenue of $115.9 million. Analysts were expecting 85 cents a share on revenue of $100 million. For the full year, though, the company sees revenue in a range of $350 million to $380 million, below consensus for $398 million.

United Parcel Service (UPS) is down 0.3%, to $104.80, after Deutsche Bankdowngraded the stock to Hold. Rival FedEx (FDX) is up 1.4%, to $248.87, following an upgrade to Outperform at Bernstein. —Teresa Rivas

The View From Silicon Valley

“Brotopia” is a four-letter word in Silicon Valley.

What has bedeviled Hollywood, the Beltway, Wall Street, and Main Street is put on full display, warts and all, in a new book on tech’s rampant sexism.

Brotopia: Breaking Up the Boys’ Club of Silicon Valley (Penguin Random House), from Bloomberg Technologyreporter Emily Chang, offers vivid proof of San Andreas Fault-sized cracks in a culture that prides itself as a modern-day utopia where anyone can change the world with a Big Idea.

That’s the augmented-reality version of what the Valley wants you to believe. Beneath the veneer of equal opportunity is a system in which women are routinely excluded, marginalized, and harassed—while young white males look out for their own.

The gender gap is a very real thing in the Valley. It has been for decades. But it has coarsened of late with even more funding, record revenue, and outsize expectations on the line. From the lurid front-page scandals of harassment that ensnared UberTechnologies to behind-the-scenes stories of sex parties filled with venture capitalists and entrepreneurs, Chang’s book exposes the underbelly of Silicon Valley boys behaving badly.

Along the way, she explains the culture that tolerates such behavior and offers suggestions to address the lingering problem. Among those interviewed are former Yahoo! Chief Executive Officer Marissa Mayer, Apple CEO Tim Cook, Facebook Chief Operating Officer Sheryl Sandberg, and VC Ellen Pao, who lost her lawsuit against former employer Kleiner Perkins Caufield & Byers.

There is no tidy solution to this systemic issue, but an encouraging first step is discussing the problems openly, as Chang’s interesting new read does.

—Jon Swartz

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Stocks Look Set to Open Higher on Renewed Confidence

Stocks are looking to open higher this morning, as Wall Street takes a rosier view of the Federal Reserve, interest rates, and inflation.

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